ETH Bearish Compression: Why the $3,040 Ceiling Defines the Next Major Move – 2025 12 24

What a difference forty-eight hours makes in the crypto markets. Just two days ago, we were tracking a hopeful relief rally that briefly pushed Ethereum above the psychological 3,000 level, but today we find ourselves back in the trenches of a bearish compression structure. Comparing today’s price action to our previous analysis, the market has strictly respected the “Trap Zone” we identified. The rejection at 3,060 on Monday wasn’t just a random fluctuation; it was a structural failure that has now trapped late longs and forced price back into a tightly wound range around 2,925. The relief rally has effectively been erased, and the short-term trend has realigned with the dominant daily and weekly downtrends.

Our prediction accuracy for this week remains high, though the “bull case” we assigned a 20% probability to earlier in the week has evaporated. The failure to hold 3,000 confirmed our skepticism about the rally’s sustainability. Today, the most critical observation from our charts is the extreme compression of moving averages across the 4-hour, 6-hour, and 12-hour timeframes. When we see this kind of “coiled spring” behavior below a major resistance level—specifically the Purple Weekly MA at $3,040—it typically precedes a violent expansion in volatility. The market is deciding right now whether to attempt one last squeeze or to let the floor drop out.

Looking at the internals, the indicators paint a cautious picture. The Money Flow (CMF) remains negative on intraday frames, telling us that distribution is still the dominant force despite the sideways chop. However, we must remain objective and note the one “green shoot” on the 12-hour chart: the MACD is hovering just above its signal line near zero. If—and only if—this indicator can cross decisively into positive territory while Stochastic RSI pushes higher, we could see a sudden spike to punish shorts. But until that happens, the trend is your friend, and the trend is down.

For the next 24 to 48 hours, our eyes are locked on the $2,750 level as the potential target if the current floor at 2,913 gives way. We are maintaining a short bias, using that critical $3,040 level as our line in the sand for invalidation. Traders should be prepared for choppy conditions as this compression resolves, likely flushing out weak hands in both directions before choosing a path. Stay defensive, watch the 12-hour closing candles, and don’t chase the noise in the middle of the range.

#ETH #Ethereum #CryptoTrading #Bearish #Volatility #TechnicalAnalysis